The Federal Trade Commission today issued a report that identifies spyware as "a real and growing" problem.

Eleven months after its April 2004 workshop, "Monitoring Software on Your PC: Spyware, Adware, and Other Software," the FTC released a report summarizing its findings, a transcript of the day-long panel discussion, and related documents.

The report confirms what many security professionals have been warning, namely that "spyware is a real and growing problem and that spyware can impair the operation of computers and create substantial privacy and security risks for consumers' information."

To mitigate spyware, the FTC staff recommends government and industry action, in the form of increased prosecution under existing laws and more educational initiatives. The report finds that technological solutions, both hardware and software, provide significant protection.

The report asks the business community to come up with a definition of spyware, pointing out that there's no consensus as to whether adware is spyware.

"Because of the challenges of developing a workable definition of spyware, nearly all panelists expressed the concern that legislation or regulations tied to a definition of the term 'spyware' might define the term so broadly that it would inadvertently cover some types of beneficial or benign software," the FTC observes.

As an example, the report points out that a recently enacted Utah law--the Spyware Control Act, which has been challenged in court--might make parental-control software illegal.